Posts tagged ‘Jeff Sovern’

Professor Jeff Sovern spoke at the University of Houston’s Teaching Consumer Law Conference (held in Santa Fe) on May 20. His topic was “Are FDCPA Validation Notices Valid?” and he spoke about the study he and Psychology Associate Professor Kate Walton are conducting, funded by the National Conference of Bankruptcy Judges Endowment for Education.

“The bureau has been meticulous about relying on its research findings, and I respect the fact that they felt they needed to know more before going further,” said Jeff Sovern, a professor at the St. John’s University School of Law and a critic of the arbitration clauses. “It will be interesting to see what the data they will collect shows.”

He was also quoted in an April 28 story on Bankrate.com headlined “Chase Now Offering Its Customers Deals on Jaguars.”

Because the Bureau usually combines field hearings with announcements of related developments, it is likely to announce its proposed arbitration rules that day,” Jeff Sovern, a professor at St. John’s University School of Law, wrote in the Consumer Law & Policy Blog sponsored by the Public Citizen litigation group.

MORE ON COST-BENEFIT ANALYSIS — St. John’s University School of Law professor Jeff Sovern emails: “Consumer protection agencies already use CBA. The Dodd-Frank Act directs the CFPB to ‘consider’ costs and benefits. The FTC has a Bureau of Economics which effectively institutionalizes CBA. Neither the CFPB nor the FTC can find a practice unfair unless they find that it causes ‘substantial injury . . . which is . . . not outweighed by countervailing benefits.’”

Objectors bring advocacy into an inherently non-adversarial setting, Jeff Sovern, a professor at St. John’s University School of Law, in Jamaica, N.Y., told Bloomberg BNA.

“When parties settle, both sides have a stake in making arguments for approval of the settlement, which means that unless a class member or ‘watchdog’ criticizes a class action settlement, the court may not hear the arguments against it, and the adversary system may not function as it is normally does,” Sovern said in an e-mail.

There is precedent for agencies using enforcement actions to help define what a statute means.

The FTC, for example, only formalized its guidance for what constituted unfair practices under its UDAP authority in 1980, decades after it was granted the authority to police firms for such actions.

Doing so gave the FTC flexibility to find unfair practices and get a more useful vision of how to prevent them, said Jeff Sovern, a professor at St. John’s University School of Law. And the CFPB is doing something similar, he said.

“When dealing with a relatively new legal standard, like the bureau’s powers to curb abusive acts, it helps to let the law develop for a while before freezing it in a rule like a fly in amber. That way, lawmakers can see how best to interpret the law,” Sovern said.

Voters should ask candidates their positions on consumer protection. Presidential candidate Ted Cruz, who has called for elimination of the CFPB, should have to say whether consumers who have obtained redress because of the CFPB ought to return money to their swindlers — and who will stop the swindlers next time. And candidates should make clear whether they believe we should return to the way things were, with the laws that led to the Great Recession, or whether they support enforcement of consumer protection laws.

“I think they are very troublesome,” Jeffrey Sovern, a law professor at St. John’s University, in New York, said of the arbitration clauses. “Class action lawsuits are a mechanism to deter businesses from taking advantage of consumers in small amounts,” he told Bloomberg BNA, echoing a point made by Cordray in his speech.

A customer who is mistakenly charged $30 on his mobile phone bill is unlikely to file a claim in court or arbitration to get the money back, and such a case is too small to justify hiring an attorney, Sovern said. If that customer files a class action on behalf of a million customers hit with similar charges, that’s a $30 million lawsuit, and the dynamics have changed.

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The New York Times published a letter from Professor Jeff Sovern on December 30 on debt collection and arbitration. Sovern wrote in part:

You show that debt collectors sue consumers in court when it suits them but bar consumers from bringing court actions by invoking obscure arbitration clauses in consumer contracts.

Businesses defend their right to do so because, they claim, arbitration is better than court for resolving disputes. But if arbitration is superior, why do businesses want to sue in court, rather than arbitrate, as your article shows and an empirical study confirms?

The answer is that businesses value arbitration chiefly when it enables them to block class actions so they may take advantage of consumers for small amounts without worrying about consumers suing them.

Last month, the bureau made public a proposal to block class action waivers in arbitration clauses. A leading advocate for arbitration in the financial industry, Alan Kaplinsky, responded with [a] forecast of how the industry would respond: “We firmly believe that, should the CFPB enact its proposal to ban class action waivers, most companies will abandon arbitration with the result that arbitration will no longer be available as a quick, efficient and inexpensive way of resolving disputes.”

But if the industry truly believes that arbitration is so much better than litigation at resolving disputes, shouldn’t it prefer arbitration to litigation for resolving individual disputes, where there is not a threat of a class action? Or should we be shocked, shocked, to discover the industry’s love of arbitration is about barring class actions?

If you’re a TiVo user, your digital video recorder may be ratting you out to advertisers.

In the latest example of consumer privacy being threatened by Big Data, TiVo’s number-crunching subsidiary this week announced a partnership with media heavyweight Viacom that helps advertisers target TV viewers with specific commercials.
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Is this arrangement fair to TiVo users? They apparently have no choice except to cancel their service. TiVo’s privacy policy states that the company “may work with third-party advertising companies that collect and use information to deliver more relevant advertising.”

Jeff Sovern, a professor at St. John’s University School of Law in New York, called this an “unfortunate” way of getting subscribers to agree to having their personal information exploited for marketing purposes.

“Unless TiVo actually makes an additional effort to tell its customers what it is doing, probably many will think that information about their viewing choices is not being given to others, when it is,” he said.

Jeff Sovern, a consumer rights expert and law professor at St. John’s University, spoke with Legal Newsline about this case. He said the verdict will likely be determined by what is expected of consumers.

“It sounds like the Best Buy offer was a typo. Courts have sometimes held advertisers liable for not living up to a price printed in error,” Sovern told Legal Newsline. “False advertising laws generally focus on whether a consumer would have been deceived by the ad.”

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“My own guess is that a reasonable consumer would recognize that was a typo,” Sovern said. “But other laws ask whether the ad would fool the credulous consumer. Maybe a credulous consumer would have been deceived.”

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West Academic Publishing has published the 2015 edition of Selected Consumer Statutes, co-edited by Professor Jeff Sovern, along with Professors Dee Pridgen and Christopher L. Peterson. The volume spans 1200 pages and is the most up-to-date collection of statutes, regulations, and other consumer law materials available for use in a consumer protection course or for practicing attorneys.